improving performance in operations

Improving Performance in Operations

David Lengacher, Six Sigma MBBAdjunct Prof., Univ. of MarylandPrincipal, Concurrent Tech. Corp.

dclengacher@gmail.com

Intro

1. Who are you and what brought you here?2. Your dream job, position, or title?

Performance & Leadership

You can affect organizational performance via…

• Qualitative Skills (our focus today)

• Quantitative Skills (Lean, Six Sigma, Ops Research)

Leadership: Exterior & Interior

Metaphor

Leadership

“Above all other traits and characteristics…. leaders are those who are more PREPARED than anyone else”

-Peter Drucker-

Preparedness starts with developing situational awareness…

What is SA?

…a perception of key details, critical to decision-makers in a complex environment.

It’s better to have STRONG opinions and be wrong than it is to be indifferent.

Why? Because if you wait for 100% perfect info…you’ll never have a strong opinion.

Takeaway regarding Situational Awareness

Situational Awareness

Takeaway…

• Good Leaders have STRONGER opinions about more organizational topics than their subordinates.

• NOTE: I didn’t say “more accurate opinions”

Test Your SA

…of your organization, industry, etc.

• Name the Top 3 external “risks” facing your org.

• Name the Top 3 internal “risks” facing your org.

“thing” = initiative, product line, etc.

Test Your SA

…of your organization, industry, etc.

• Name the most recent thing your org has stopped doing or divested in.

“thing” = initiative, product line, etc.

Test Your SA

…of your organization, industry, etc.

• Name the most recent thing currently under review for divestiture or elimination.

“thing” = initiative, product line, etc.

Accurate SA = Correct Language

Definitions are IMPORTANT

Test Your SA

…of your organization, industry, etc.

• How does your org define “Efficiency”?

• How does your org define “Effectiveness”?

Future Leaders should have strong opinions about what these terms mean in their current org…

But….

….my org doesn’t really use the terms “Efficiency” and “Effectiveness” at work….

• Don’t be afraid to introduce these terms to your peers and supervisors.

• “But I might be way off basis?”

• Then use industry-specific literature/publications to identify the standard definitions and applications.

Identify Your Information Gaps

Find gaps in your awareness of your organization or field and FILL THEM!

• Write down 1 thing you know you don’t know.

SA includes History

• SA is not just knowing what an organization is doing or wants to do… but also what it has stopped doing.

• The past is as important as the present.

• Become your department’s amateur org-historian. Why? Not to score points at lunch, but to build confidence in your SA.

Growth

“The first step in a growth policy is not to decide where and how to grow. It is to decide what to abandon. In order to grow, a business must have a systematic policy to get rid of the outgrown, the obsolete, the unproductive.”

-Peter Drucker-

Leadership: Interior

Internal Preparedness

• Fear • Curiosity• Belief• Behavior• Stress• Expectations

Fear

You can leverage it, but in most cases you will never conquer it.

Why? Because fear is natural and is present in every species on Earth.

Proof? Just watch Animal Planet!

Fear Pays!

Fear

• Exercise: Write down 2 of your most recent fears that kept you up at night. 1 personal, 1 professional.

• Good news: What % of all of your fears have ever came true?

Leveraging Fear

If you lie awake at night fearful of losing “X”…

…then devote more of your resources to either securing “X”

…or liquidate “X” or remove “X” from your life plans.

Especially if you realize that “X” does not lie on your critical path!

Leveraging Fear

If you lie awake at night fearful of your future

…then leverage that fear by taking a multi-pronged approach to standing out from your peers!

Ideas:• Publish! In newsletters, journals, etc. • Don’t just attend conferences…Present!• Publish!

Publish Your Thoughts

….because the best and brightest people in your peer group are.

Exercise: List the 3 places you think your peers are publishing.

Leveraging Fear

In summary…

You can never conquer all of your fears…

But you can covert many of them into TENACITY

Exercise

• Exercise: How can you use 1 of your fears to drive action?

Curiosity

“The single most important trait when selecting a successful player is curiosity. Because a curious person will find solutions to problems before they manifest. A curious person is a prepared person.”

-Bobby Knight-

Curiosity

Exercise: Who is the most curious person you know?

If that person is a 10 on the scale, then rate your own curiosity 1 to 10.

Belief

“Think you can or think you can’t. Either way, you’ll be right.”

-Henry Ford-

Belief

• Exercise: Rate how strong your belief is in your own professional capabilities 1 to 10.

Stress

“It’s not the load that breaks you down, it’s how you carry it.”

-Lena Horne-

Stress

• Exercise: Rate your ability to handle stress from 1 to 10.

Risks

“You can’t steal 2nd base with one foot on 1st.”

-Frederick B. Wilson-

Risks

Exercise: Name 2 risks that you almost took, but didn’t following through with.

Are you more risk-averse or more risk-taking?

Exercise: Rate your risk tolerance 1 to 10 (risky)

Risks

Regardless of your answer, there is 1 sure-fire way to leverage your current risk tolerance...

Risks

TELL OTHERS ABOUT IT!!!

Expectations

“Expecting the world to treat you fairly because you’re a good person is like expecting the bull not to attack you because you’re a vegetarian.”

-Dennis Wholey-

Expectations

• Exercise: Rate how aggressive your professional expectations are from 1 to 10

Internal Performance

• So how can you use these 6 principles to improve your own performance?

• By reallocating energy within your internal portfolio

As-Is Model…..To-Be Model

Leverage FearBeliefBehaviorStressUncertaintyRisksExpectations

How to Take Action

Consider This

“People don’t change much. Don’t waste time trying to put in what was left out. Try to draw out what was left in.”

-Warren Buffet-

Best use of Your Time

In the next 90 days, you will have xxx hours of free time to devote toward learning or skill building. Which is better for you?

• Making your strengths even stronger• Making your weaknesses less weak

i.e. Do you want to be “average” in 5 areas….or an eventual expert in 2 areas?

Interviewing

• Exercise: Write down the 1 or 2 of the most popular interview tips.

• What is one of your own tips?

Your Next Interview

Don’t sell who are you today….

Sell who you will be in 6 months…especially when you take your current tenacious pace of learning and extend it inside the organization.

Sell the seed……not the plant!

Your Next Interview

Ask them this: “Every organization defines efficiency and effectiveness differently; how do you define them here?

• Efficiency• Effectiveness

You’re guaranteed to stump your interviewer and simultaneously look smart.

Your Next Interview

Also ask:

“Innovation affects every organization differently….what is the most recent innovation that has changed the way you do business?”

What do you see?

From Consumer….To Producer

Learning

There is no substitute for experiential or unguided learning.

Classes are good

Amazon.com is better

• What does your book shelf look like? • Does it look like it belongs to the person you want to

become? • Do you own at least 5 books on your field or position with

highlights and sticky notes poking out?

Quantitative Skills

Performance Improvement via Quant

• Lean Inc Speed/Removing Waste• Six Sigma Reducing Variation• Ops Research Scientific Decision Making

Lean

1 min End

1 min 1 min 1 min 1 min End

2 min 2 min 1 min 1 min End

How many units enter the END stage per hour?

Continuous Operations (aka “warmed-up”)

A

B

C

Lean

1 min End

1 min 1 min 1 min 1 min End

2 min 2 min 1 min 1 min End

Where would you focus your process improvement efforts?

A

B

C

Lean

1 min 2 min 1 min 1 min End

Reducing processing time by 50% does you no good!

C

Why? Because the slowest link defines the speed!

Lean

1.5 min 1.5 min 1 min 1 min End

Reducing 2 processes by 25% does make a difference

C

Seven Deadly Wastes

• Defects• Waiting• Motion• Transportation• Inventory/WIP• Over-production• Over-processing

Some organizations add other wastes, particularly injuries and wasted human talents

Defects

In service, this can be:• Missing information• Missing deadlines• Incorrect documents• Mis-labeling/categorizing

Usually detected downstream

Waiting (downtime)

• Delays between the end of Step 1 and the beginning of Step 2.

• Because service work is often invisible, process mapping is critical for finding these delays.

Motion

• Switching screens constantly or having to perform too many keystrokes to accomplish a task.

Inventory / WIP • Excess WIP Slower Reaction

Time• Look for physical piles of

forms (inboxes). • List of pending requests in:– Email– Callers on hold– People standing in line

Overproduction

• Creating product before it is needed

• Looking busy

Transportation• In services, manifests

itself as constantly walking down hallways to collect/deliver materials or chasing information.

Over-processing• Doing more work than your customer

wants:– Multiple signatures– Over inspection

Over-processing• Think of a process that requires multiple

approvals. Does your customer think that each approval is adding this his/her value?

• Would they be just as happy if there was 1 approval so it could get to them faster?

• If so, then you’re over-processing!

Six Sigma

• Focuses on reducing variation in the processing of work.

• Examples of variation in your job?

99% Quality 1% Defects

Good

DefectsDefects

McDonald’s Drive-Thru

Good Defects

How do Lean & SS Interact?

1 min 1 min 1 min 1 min End

What if these are average cycle times? i.e. What if there is variation from 30 secs to 1.5 mins?

Reduce sources of variation….to both decrease defects….and increase speed!

Identify the Weakest Link

99% Yield

99% Yield

99% Yield

80% Yield

99% Yield

99% Yield

99% Yield

.99 x .99 x .99 x .80 x .99 x .99 x .99

75%

Quality Level of System

Discussion

What is 1 information gap you could fill to help you gain a better Situational Awareness in your current role?